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Is iPhone 15 going to ‘move the needle’ for Apple stock?

Is iPhone 15 going to 'move the needle' for Apple stock?

As the anticipated iPhone 15 hits the shelves, investors are watching how this latest release will impact Apple Inc’s (NASDAQ: AAPL) stock performance. Indeed, in the past years, Apple’s iPhone release has positively impacted the stock due to factors such as the introduction of new features.

However, with the latest release, there is some market skepticism regarding the iPhone 15’s impact on the stock. In this line, D.A. Davidson Managing Director and Senior Research Analyst Tom Forte has expressed a cautious stance on Apple’s stock, giving it a neutral rating with a price target of $180 per share.

Speaking during an interview with Yahoo Finance on September 22,  Forte pointed out that he does not expect the sales to ‘move the needle for the stock.’ 

Forte’s reservations stem from several factors, including macroeconomic challenges in China and the new features, such as advanced connectivity options.

“If you look at either macroeconomic challenges in China– and China’s about 10% of sales for Apple– or the fact that at least from my vantage point a titanium iPhone or an iPhone essentially with OnStar, things of that nature, I don’t think that’s going to move the needle for the stock,” he said. 

Forte’s skepticism is also grounded in the fact that Apple itself has projected a decline in revenue for the September quarter despite the launch of the iPhone 15. This anticipation of a revenue decline suggests that the company might not be overly optimistic about the immediate impact of its latest smartphone lineup on its financials.

Apple bullish thesis

However, proponents of a more bullish outlook argue that the success of the iPhone 15 may not be solely reliant on groundbreaking features but rather on the vast pool of potential upgraders. They point to the staggering number of iPhones currently in circulation, estimated to be around a billion, with hundreds of millions being several years old.

In response to this bull thesis, Forte acknowledged the potential for upgrades but highlighted a crucial factor—the continued support from carriers. He noted that carriers still heavily subsidize consumers to encourage them to adopt the latest iPhone models. This support is a significant driver for the iPhone’s sales as carriers seek to leverage their investments in 5G network infrastructure.

Additionally, Forte underscored the importance of the 5G network as a compelling reason for consumers to transition from older iPhone models to newer ones. The carriers’ commitment to subsidizing the latest iPhones suggests that, at least in the short term, the upgrade cycle may continue to be supported by these partnerships, potentially benefiting Apple’s bottom line.

Apple stock analysis

It is worth noting that despite the bearish sentiment, Apple’s stock has been soaring in 2023, recording an impressive surge of over 50% in its stock price.

Notably, AAPL’s bullish run coincided with the impactful launch of the Apple Vision Pro, an event widely regarded as one of the company’s most remarkable product unveilings by many enthusiasts.

Meanwhile, Apple closed at $174.74 on Friday, September 22.

AAPL 7-day price chart. Source: Finbold

Elsewhere, the technical analysis of Apple stock, as retrieved from TradingView, is predominantly bearish. A summary of the one-day indicators suggests a ‘sell’ sentiment at 13, while moving averages indicate a ‘strong sell’ at 12, with oscillators aligning with ‘neutral’ at 8.

AAPL technical analysis. Source: TradingView

In general, the performance of Apple’s stock heavily depends on improvements in other Apple product lines and prevailing market sentiment.

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